Ohio regulators approve AEP discount rate for Amazon data centers

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Dive Brief:

The Public Utilities Commission of Ohio yesterday approved an arrangement between Amazon and AEP Ohio that allows the online giant a discount on electricity for its data centers over the next decade. The actual details were not publicized.

In approving the arrangement, regulators acknowledged that data centers have a unique electric load profile and that the facilities would be the largest consumers of electricity in AEP's footprint.

Dive Insight:

Ohio regulators' 5-0 decision yesterday acknowledged that data centers are a different kind of beast: If Amazon is going to purchase power from AEP, then a decades-long discount is appropriate.

“This arrangement recognizes the unique electric load profile of data centers and could represent a new era of economic development in Ohio,” PUCO Chairman AsimHaque said in a statement. “It is important to note that consumer bills will not increase as a result of the Commission’s approval today.”

The deal provides a discount on electricity purchased from AEP Ohio by Amazon subsidiary Vadata Inc., for 10 years. The application specifies that other customers on the AEP system will not see a rate increase due to the business arrangement. However, consumer advocates say more information about the arrangement should be released.

“There’s no question there’s a trade secret exemption in the law, and there’s no question it can easily be abused,” Dennis Hetzel, head of the trade group Ohio News Media Association, told the Columbus Dispatch. He told the paper he believes more information about the application should have been made public. “I’m not seeing what about this needs to be secret,” he said.